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Defense Ministry bought plastic flasks for army at 3 times market rate, investigation finds

by Abbey Fenbert June 26, 2024 5:14 AM 3 min read
A Ukrainian servicemember holds a flask of water in his hand on July 3, 2023 in Donetsk Oblast. (Viktor Fridshon/Global Images Ukraine via Getty Images)
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The Defense Ministry has spent millions purchasing plastic flasks for Ukraine's Armed Forces at three times the market price, according to an investigation published by NGL Media on June 25.

The State Logistics Operator (DOT), a government procurement agency established in December 2023, spent more than 54 million hryvnias ($1.3 million) on 153,000 flasks in 2024 alone.

The 1-liter plastic flasks, purchased from China, cost the government 335 hryvnias ($8.24) each, although the same model can be found for 120 ($2.95) and similar varieties are available for 72 ($1.77), NGL Media reported.  

The investigation found that DOT signed contracts for flask procurements with two companies, Coltrane LLC and Superform LLC, after rejecting significantly less expensive offers from other firms following auctions held in January and April 2024.

NGL Media found that both companies have been operating for short periods of time, during which they immediately signed contracts worth millions of hryvnias.

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Superform LLC was founded six months ago by Vladyslav Lykoshenko, a 27-year-old from Zaporizhzhia. According to the investigation, Superform has already secured five agreements with the Defense Ministry and National Guard totaling nearly 310 million hyrvnias ($USD) in the last two months.  

Lykoshenko in 2022 established a company called Professional Equipment LLC, which went bankrupt a year later.

Coltrane LLC was founded by Olga Chubenko and Lidiya Khomenko, both of whom have many other businesses registered in their names. Yuliya Kikot took over ownership of Coltrane in 2024, at which point the company began signing significant contracts.

DOT ostensibly rejected cheaper offers for the flask purchases because the products did not conform to the technical standards laid out by the Defense Ministry. The ministry has developed its own standard based on the U.S. Army canteen.

Lykoshenko did not respond to NGL Media's request for comment, but Kikot, director of Coltrane, told investigators that the only manufacturer whose flasks met the technical description was a Chinese producer known as Taizhou Huangyan Sigg Mould Co., Ltd.

According to investigators, the Taizhou flasks can be purchased on the Alibaba.com marketplace for 154 hryvnias ($3.85), while essentially identical models can be found on the site for 100 hryvnias ($2.50). The only difference is the absence of the incription "Property of the Armed Forces of Ukraine, not for sale."

The journalists estimate that the intermediary companies will earn millions from the flask contracts, with Coltrane's net profit estimated at 20-24 million hryvnias (nearly $600,000) and Superform's smaller contract at 10-11 million ($270,000).

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